Bruce Berkowitz Buys Buffett's Berkshire and Kraft Heinz in the 1st Quarter
Bruce Berkowitz (Trades, Portfolio), founder and managing partner of the Fairholme Fund (Trades, Portfolio), disclosed last week that his top buys for the first quarter included a position expansion in Warren Buffett (Trades, Portfolio)'s conglomerate Berkshire Hathaway Inc. (NYSE:BRK.A)(NYSE:BRK.B) and new holdings in The Kraft Heinz Co. (NASDAQ:KHC), Occidental Petroleum Corp. (NYSE:OXY), Simon Property Group Inc. (NYSE:SPG) and Western Midstream Partners LP (NYSE:WES). The founder of the Miami-based firm applies Benjamin Graham's strategy in his stock picking, seeking companies that have solid management, generate high free cash flows and are trading at a deep discount to intrinsic value. As of the quarter-end, Berkowitz's $510 million equity portfolio contains seven stocks with a turnover ratio of 13%. The Omaha, Nebraska-based conglomerate operates a wide range of subsidiaries, which primarily include insurance companies like Geico and Berkshire Hathaway Reinsurance Group. For its investment portfolio, Berkshire applies a four-criterion investing approach stemmed from Buffett's mentor Graham: Buffett and co-manager Charlie Munger (Trades, Portfolio) seek companies that have understandable businesses, favorable long-term prospects, competent management and attractive valuations. Berkowitz purchased 444,500 shares of Kraft Heinz, giving the holding 2.16% weight in the equity portfolio. While shares averaged $27.55 during the first quarter, the stock is now trading close to its 52-week high of $33.78 despite languishing near a 52-week low of $22.82 in March.